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Susan SmithSusan Smith has worked as an editor and writer in the technology industry for over 16 years. As an editor she has been responsible for the launch of a number of technology trade publications, both in print and online. Currently, Susan is the Editor of GISCafe and AECCafe, as well as those sites’ newsletters and blogs. She writes on a number of topics, including but not limited to geospatial, architecture, engineering and construction. As many technologies evolve and occasionally merge, Susan finds herself uniquely situated to be able to cover diverse topics with facility. « Less

Susan SmithSusan Smith has worked as an editor and writer in the technology industry for over 16 years. As an editor she has been responsible for the launch of a number of technology trade publications, both in print and online. Currently, Susan is the Editor of GISCafe and AECCafe, as well as those sites’ … More »

The Autodesk Subscription Program Meets Bentley’s Autodesk License Upgrade Program

An ongoing topic in the AEC industry for over a year now has been the issue of Autodesk’s moving its customer base to a subscription only program. While Autodesk has given customers a lot of time to make this transition, nevertheless, the Autodesk Subscription Program means the end of the perpetual license program. The Autodesk Subscription Program is heralded by the company as the best thing for customers of Autodesk products and they have the recent earnings to prove it. In Q1 of this year, they were up 132,000 to 2.71 million.

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On July 31, 2016, Autodesk exited the perpetual license program. On July 12 Bentley announced their Autodesk License Upgrade Program, in response to Autodesk’s post on their website. The Bentley offer was directed at Autodesk users who own perpetual licenses and wish to retain those licenses.

Bentley will continue to offer subscriptions and perpetual licenses for infrastructure customers. “We want everyone to know that if perpetual licenses are important to you this is a way you can continue to use them,” said Bhupinder Singh, Bentley’s chief product officer. “Beyond retaining the choice we are making a compelling offer to Autodesk users to become Bentley users. Bentley will credit the net value of perpetual licenses of Autodesk to professional licenses of Bentley applications.”

In response to Bentley’s announcement of an upgrade program for Autodesk customers, Carl White, senior director of Business Models at Autodesk, wrote about Autodesk’s intention with their offerings – both perpetual and subscription:

Fact #1 – No Autodesk customer ever loses the right to use the perpetual software license you’ve purchased, it is “evergreen”. And if you’re on a software maintenance plan, you can continue to receive all of the benefits of software updates and technical support for as long as you’d like.

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We’ve shared key dates well ahead of time to give customers time needed to adjust, but that does not mean we’re taking away options. Rather than taking our word for it, here’s what one respected industry watcher had to say: “I really just wanted to make it 100% clear: if you have a perpetual license and continue to pay maintenance, NOTHING CHANGES on February/August 1, 2016 unless you want it to.”

Bentley’s statement: If you can no longer upgrade a product, then it loses value. The organization that owns it has lost equity in its asset. Yes, you can get software updates and technical support and be on a maintenance plan from Autodesk. The license lapses that is no longer available, secondly, can’t exchange or cross grade one license for another. Users of a standalone Autodesk perpetual license can no longer convert to a shared network license.

Fact #2 – Our customers have a choice. When you subscribe to Autodesk software, you have flexible terms (monthly, quarterly, annually), and multiple access points (single user, multi-user and shared). Now Autodesk customers can get the software they need for a year or a month, in ways that are more convenient and better for their business. Customers can buy and use it for as long as they want and can match their subscription type with the demands of their workforce. When the workforce expands, they can ramp up, or in quieter periods, they can scale it back. In short, subscribing gives you flexibility and predictability.

When it comes to value, lower upfront costs make our software more accessible and allow you to try more tools without the risk of a large upfront expenditure. Plus, you only pay when you need it. This is a big deal. Some of our customers prefer this cost is considered an operating expense, allowing you to bill the cost of the software back to the client or project. And if you subscribe for a longer, multi-year term, you lock-in your rate. Combine that with flexibility in the length of contracts and you may find that you’re actually paying less.

Bentley’s statement: Autodesk customers no longer have the right to buy perpetual licenses. Bentley users have the option to purchase perpetual licenses as well as subscription.

Fact #3 – Software as a service is essential for technological evolution. It allows for continual and consistent innovation and support. The software will get better, faster and more seamless in the way you use it. The experience is customized to you or your organization, and provides a simplified way to access and deploy software, manage your users and collaborate on projects. With this new way of delivering software, everyone will always have the latest, most up-to-date Autodesk tools available.

It’s not just Autodesk saying this; the entire software industry is moving in this direction. Frankly, design and engineering software has been a bit slow to make this change. But the benefits for end-users are clear, and it’s just a matter of time before all vendors have similar ways of buying.

Fact #4 – Our recent earnings results validate our move to an all subscription-based model and readiness of the market and our customer base. More customers are getting on board every day. In Q1 of this year, they were up 132,000 to 2.71 million.

What does this mean? It means that millions of you are already seeing the benefits of shifting to subscription and are making that choice voluntarily.

So Bentley, we have this to say to you: announcing competitive upgrade programs makes for sensational headlines, but it doesn’t solve customers’ problems. Autodesk is in the business of giving our customers the best tools possible to solve their businesses’—and the world’s—biggest challenges.

Bentley’s statement: Autodesk users didn’t have a choice to purchase perpetual licenses, they got a temporary discount on subscriptions only. It’s clear Autodesk is making this choice compulsory.

In a press conference held by Bentley Systems, journalists asked a few questions:

What types of users are more likely to prefer perpetual license over subscription service?

“We found that in our experience, it’s a cultural preference often,” replied Singh. “In our industry, in some countries, they are only permitted to purchase perpetual licenses, where they can depreciate over time. Our experience shows us they want the choice, and rightly so. We have offered both choices for over a decade. We have organizations starting a relationship with us in one business model and moving to the other offering, and vice versa. Our users should decide what works best for them.”

For just subscription licenses alone, what are the differences between Autodesk and Bentley?

“We have deeper subscription experience – based on what users want and how they work,” said Singh. “We never limit someone – the number of people working on a project may vary from week to week. Where a project may continue for years, we want to be sure any user can access software when they need it, for how long they want to use it. Incidental use is not counted. We think it’s unrealistic for customers to all be on subscription, especially when teams span organizations.

Can Autodesk subscribe to a number of different products?

“The risk here is shelfware, they say they only pay for what they use,” said Singh. “Users have no recourse but to buy another subscription for a new requirement for a new user. Bentley allows the account to exchange titles for what they need, so they can meet changing needs over time.

Bentley considers purchase of perpetual licenses a long term investment by users. The comparison is users will lose value on Autodesk versions because new ones will not be coming out.

“I think the key point is not whether a user is adopting every update we make available; it is what flexibility are we giving them?” said Singh. “They have a lot of flexibility with the SELECT program for support of our apps. Through SELECT they get access to regular updates, older versions, (often need access on current projects), onDemand learning, from product experts, at a country level, pooled rights for their products, portfolio balancing, and users can re-establish SELECT for their perpetual licenses at any time.”

Now that Autodesk users cannot purchase perpetual licenses, some of the holders have their rights limited, in order to drive them to subscription. Apparently, they cannot put those licenses back on their maintenance plan.

Bentley claims that response to their program has been “strong so far.” Since Autodesk users also use Bentley software, most are already comfortable with it. “We’re also seeing a strong response, not just users impacted, but channel partners who have sold perpetual licenses.”

How does the Autodesk Bentley license program work?

Autodesk users will receive full credit for their perpetual license toward one of Bentley’s. “We will appreciate the credit for each year that the maintenance is lacked. Value may be better than original value,” said Singh.

“It’s about the ability to purchase additional perpetual licenses as needed. Obviously users continue to use software packages they own. What makes software evergreen is that it is in productive use as the day it was purchased, kept current and updated, and can be exchanged for another title as needs change over time. Autodesk users did have an option to enter into a maintenance program but it wasn’t as effective as for subscriptions.”

“Autodesk says that they will receive tech support, maintenance for as long as they would’ve liked. It’s impossible to say how well they will support the perpetual license people,” said Singh. “Their current move to exchange perpetual license credit for subscription shows that. This is not extended to perpetual license owners.”

Which products are being traded in from Autodesk?

“The exchange program applies to an extensive list of Autodesk products where we have competitive offerings – their entire AEC suite including, Navisworks, AutoCAD, and BIM. They can apply their perpetual license credit in aggregate while choosing an appropriate Bentley mix of products. AutoCAD is being traded for Powerdraft, for drafting workflows, they are looking to upgrade to BIM modeling workflows, 3D parametric design using MicroStation, also for multi-discipline aggregation and deliverables.”

Bentley states that Autodesk’s strategy is to move to the Cloud. “We believe that cloud services add a lot of value in collaboration, data management, software services, compute intensive activities,” said Singh. “We firmly believe our users will live in a hybrid environment, whether public or private clouds, a mix of cloud, mobile and desktop requirements where they have a choice of this hybrid workflow. ProjectWise for instance, can leverage in hosted cloud environment or deployed on premise, we don’t charge for these servers, and can install on as many servers as they want, on public or private cloud. Our BIM applications made cloud services intrinsic through desktop applications, so whether it’s MicroStation or AECOsim, they are all adding tremendous value.”

An Autodesk user (who chose to remain anonymous) recently wrote to me at AECCafe about the Autodesk subscription situation and here’s what he had to say:

“I believe forcing users to use CAD software on subscription is in the best interest of the CAD vendor, not the end user.

The option to rent the software monthly offers a lower up front cost but the user ends up paying much more for the software over time. Being on subscription also forces the user to adopt frequent upgrades which might wreak havoc on their CAD standards or workflows. In many offices it’s standard practice to wait until the first service pack for a new release before upgrading. This practice will no longer be possible. Being on subscription could be a real problem for a small firm with cash flow issues. What if you can’t pay the fee and lose access to the software?

I recently looked into using Advance Steel, a plug-in for AutoCAD using the subscription model. I occasionally detail steel structures for public artwork and thought it’d be useful if I could rent it on a monthly basis as needed. I inquired about it through an Autodesk reseller and found out that I couldn’t rent it monthly, only quarterly which was too big of an investment for the use I’d get out of it. I also found out that the reseller couldn’t sell any software to me on a monthly basis, I’d have to go directly through Autodesk in order to get a monthly rate. Sounds like the subscription model is also unfavorable to the CAD reseller!”

Some quotes from customers who have made the shift to the Autodesk License Upgrade Program:

Roy Kim, Principal of PacRim Engineering, said, “Bentley’s new Autodesk License Upgrade Program was a fitting solution for our organization — a small business which is experiencing growth. With Bentley’s CONNECT Edition applications, our users came up to speed quickly and are already realizing impressive productivity gains.”

John Cruikshank, President & CEO, JMC2 Civil Engineering + Surveying, said, “Autodesk continually sets deadlines forcing us to give up our perpetual license for an annual subscription. Their actions have made sticking with the great Bentley products that much easier. With design software being the lifeblood of our civil engineering and surveying operations, it has always been our objective to keep our applications up to date and to maximize our investment. Bentley’s new Autodesk License Upgrade Program is the perfect solution for us. And with Bentley’s CONNECT Edition applications, our staff can get up to speed fast, giving us unheard-of growth in productivity.”

Jenn Goodwin, Business Manager with Bennett Engineering, said, “Bentley’s new Autodesk License Upgrade Program was the perfect solution for our company during this growth period. With Bentley’s CONNECT Edition applications, users are up and running quickly and easily.”

While it appears that many projects and organizations are already using both Autodesk and Bentley products, the question still remains as to how easy or difficult it is to shift from a predominant reliance on one program to move to another. Also, is it possible that customer preference to retain perpetual Autodesk licenses may prevail? To AECCafe readers, please feel free to continue to comment on this issue. You can write to me at susan.smith@ibsystems.com